Free market absolutist ideologists from the United States pump out more irrelevant and confusing rhetoric than a giant squid pours out ink. The wave of criticism of China’s anti-corruption policies is a case in point.
Critics claim China’s economic slowdown is primarily due to President Xi Jinping’s anti-corruption campaign, which has been carried out nationwide over the past five years. They add that the country needs a drastic reduction in free private sector regulation to restore the sky-high annual growth rates it enjoyed for so many years.
Nothing could be further from the truth. These critics are mistaking a positive process of economic transformation and the maturing of China’s economy and society as signs of terminal structural weakness.
This is similar to a doctor looking at the hormonal change and other physical changes of growing teenagers and diagnosing them as dying of terminal cancer or old age.
While it is certainly true that China’s export-driven growth has slowed in relative terms in recent years, it continues to enjoy massive surpluses. China’s economic growth and dynamism continue to dwarf those of other major Asian nations.
Japan, especially, has still to shake off the dire effects of more than 25 years of economic stagnation. The simplistic pump-priming infusions of cash favoured by Prime Minister Shinzo Abe have failed to remedy the situation.
The massive scale and achievements of China’s anti-corruption programme are wilfully misunderstood in much of the Western media.
Far from slowing growth, the anti-corruption campaign is preventing or at least greatly reducing the incidences of corruption that, if left unattended, would divert the benefits of growth to a handful of people at the top of the national pyramid.
It is a universal truth that as societies generate more wealth, a handful of oligarchs at the top, if left to their own devices, will seize for themselves all the economic and political power and administer it narrowly and selfishly.
This was the pattern in the US during the half century of gigantic industrialisation that followed the Civil War. The first two-thirds of the 20th century then saw long, slow and usually far too delayed efforts to slow down and eventually reverse this process.
However, in the four decades since the election of president Ronald Reagan, the US government has increasingly abandoned its crucial role as a moderator of economic concentrations of power in the country.
The result has been the devastating destruction of well-paying industrial jobs and the consequent growth of social pathologies across the US heartland, especially the current hard-drug pandemic.
That is why in my book, “Cycles of Change”, which tracks the patterns in US politics from Thomas Jefferson to Barack Obama, I called the political era launched by Reagan in 1980-’81 “Evening in America” – since it heralded decline, not growth.
The same US pundits who flatly refuse to acknowledge the corruption, unfair concentration of wealth and abdication by government of its responsibility to enforce economic and criminal justice have committed precisely the opposite error in the case of China.
They look at policies that are both the consequence and necessary correction to economic success and industrial growth, and falsely mislabel them as signs of decline.
There are many reasons why China’s growth in absolute terms has slowed, and Chinese leaders and economic planners have been coping with the impact of climate change patterns across Eurasia.
China has been investing in land and maritime communications networks across Asia and cultivating vast quantities of land across sub-Saharan Africa and Latin America. These policies are proving immensely beneficial in raising the living standards and professional opportunities for hundreds of millions of people across China, and for billions more around the world.
The economic history of all prosperous industrial nations shows that a society needs more anti-corruption monitoring and restraint as an economy grows, not less.
It also shows that the central government must not abdicate its responsibilities to protect its own people from such forces, and must also be vigilant in ensuring the industrial base and economy as a whole do not suffer from unfair patterns of international trade.
China’s government has proven to be highly successful and responsible in carrying out these core obligations.
On the contrary, it is US growth rates that have remained at minuscule levels for decades.
According to Wall Street analyst Gerald Celente, median US income is now at 1999 levels; 51 per cent of all people working full time in the US now earn only $30,000 (Bt993,000) or less and home ownership is at a 50-year low.
China’s economic policies have raised a larger number of people out of poverty in a shorter period of time than any other recorded period in history.
The current slowing of overall growth rates and the success of the anti-corruption campaign, therefore, need to be recognised as the inevitable and desirable outcomes of this remarkable success.
Martin Sieff is a senior fellow at the Global Policy Institute in Washington.